Scientists believe manipulating genes within hair cells can reverse baldness.
Bald mice re-grew fur once the gene was manipulated
Researchers found it was possible to re-grow fur on bald mice by correcting a gene mutation, the Proceedings of the National Academy of Sciences reported.
Mutations in the hairless gene in both humans and mice mean the natural process of hair growth, shedding and re-growth is disturbed.
The study was carried out by teams at the Kennedy Krieger Research Institute and Johns Hopkins University.
The so-called hairless gene works by repressing the production of a protein called wise, which can hinder the process of hair growth if it is left to accumulate.
Mutations in hairless can cause complete baldness by not curbing the influence of wise.
Half of men suffer from baldness by the age of 50 although there are a variety of different causes of which this gene mutation is just one.
In humans and mice with mutations in the hairless gene, hair growth is initially normal, but once hair is shed, it does not grow back, resulting in complete baldness.
But the researchers found by introducing a normal gene in bald mice they were able to restart the process, resulting in successful fur growth.
They said the findings shed light on the hair growth process, much of which was not understood.
Half of men go bald by the age of 50
But they said more research was needed as there were other components involved in hair growth.
Lead researcher Catherine Thompson said: "Hair is maintained through a cyclic process that includes periodic regeneration of hair follicles in a stem cell-dependent manner.
"The hair cycle consists of three defined stages - growth, followed by regression and rest.
"Disruption of hairless gene function causes a complex skin phenotype that includes specific defect in hair follicle regeneration in both humans and mice."
Barry Stevens, general secretary of the Trichological Society, which represents hair professionals, said: "The thinking in the US is that there is some sort of genetic solution to hair loss.
"And I think eventually they will be proved right, but there is still work to do.
"I think it is like a giant jigsaw and pieces of research such as this will play a role.
"But the truth is we just don't know when the solution will be found, you cannot prophesise on these things."